You say I'm "ridiculous" and "detached from reality" yet the economy pretty much screeched to a halt when the Fed rased interest rates. The money stopped flowing freely, the massive layoffs began... Now we have literal banks failing. Yeah.

Nothing screeched to a halt. Money stopped flowing as freely as it once did. The layoffs are relatively massive, but the companies involved are still enormous organizations. Things have slowed down, and things are fraying at the edges, but the economy is still largely fine. This is the intended outcome of the present monetary policy.